A capital expenditure (CapEx) is money spent to acquire, improve, or extend the life of a property — a new roof, a furnace, a kitchen remodel — as opposed to an ordinary repair that just keeps things working. The tax treatment follows that distinction: a capital improvement is generally added to your basis and recovered through depreciation over years, while a routine repair is usually deducted in the year you pay it.
The line between an improvement and a repair isn’t always obvious, and getting it wrong changes your taxes, so it’s a common thing to review with a tax professional. For budgeting, seasoned owners set aside a CapEx reserve each month, because big-ticket systems fail on their own schedule and a single replacement can swamp a year of cash flow. This is general education, not tax advice.
This is general educational information, not legal or tax advice. Rules vary by state and locality and change over time — check your local law and confirm specifics with a qualified professional.